Filed by sedaredgar.com - Tao Minerals Ltd. - Exhibit 10.1






CONVERTIBLE LOAN AGREEMENT 

THIS CONVERTIBLE LOAN AGREEMENT made as of the 1st
day of December, 2009 (the “Effective Date”). 

BETWEEN: 

Tao Minerals Ltd. 

(hereinafter referred to as the
“Company”) 

AND: 

John C. Lama 

(hereinafter referred to as the
“Lender”) 

WHEREAS: 

	A. 	
      Lender desires to loan funds to the Company pursuant to
      the terms of this Agreement in the principal amount of Fifty Thousand
      Dollars (US$50,000) (the “Loan”);

	 	 
	B. 	
      The Loan is convertible (the “Conversion”) into
      securities of the Company consisting of common shares of the Company with
      a par value of $0.0001 (the “Shares”);

	 	 
	C. 	
      The Lender understands and acknowledges to the Company
      that this Agreement is being made pursuant to an exemption (the
      “Exemption”) from registration provided by Section 4(2) of the
      United States Securities Act of 1933, as amended (the “Securities
      Act”) and Rule 903 of Regulation S of the Securities Act for the
      private offering of securities; and

	 	 
	D. 	
      The Company desires to borrow funds from Lender on the
      terms and conditions set forth in this Agreement.



NOW THEREFORE THIS AGREEMENT WITNESSES that in consideration of
the mutual covenants and agreements herein contained, the receipt of which is
hereby acknowledged by each of the parties hereto, the parties hereto covenant
and agree each with the other (the “Agreement”) as follows: 

	1. 	
      Representations and Warranties of the
      Lender

	 	 	 
	1.1 	
      The Lender represents and warrants to, and covenants and
      agrees with the Company that:

	 	 	 
		(a) 	
      the Lender makes the Loan to the Company and acquires the
      Shares and Conversion Right (both as defined herein) in reliance upon the
      Exemption from registration provided by Section 4(2) of the Securities Act
      and Rule 903 of Regulation S of the Securities Act for the private
      offering of securities;

	 	 	 
		(b) 	
      the Lender is eligible to make the Loan to the Company
      and acquire the Shares and Conversion Right in the Company under
      Regulation S, and all statements set forth in the Declaration of
      Regulation S Eligibility, attached hereto as Schedule A, are true and
      correct and may be relied upon by the Company; further, all information,
      representations








	 		
      and warranties contained in this Agreement, or that have
      been otherwise given to the Company, are correct and complete as of the
      date hereof, and may be relied upon by the Company;

	 	 	 	 
	 	(c) 	
      the Lender is aware of the significant economic and other
      risks involved in making the Loan to the Company and in acquiring the
      Shares and acquiring and/or exercising the Conversion Right;

	 	 	 	 
	 	(d) 	
      the Lender has consulted with its own securities advisor
      as to its eligibility to acquire the Shares and acquire and/or exercise
      the Conversion Right under the laws of its home jurisdiction and
      acknowledges that the Company has made no effort and takes no
      responsibility for the consequences to the Lender as a non-U.S. investor
      acquiring the Shares and this Conversion right and, in particular, in
      purchasing U.S.-based securities upon exercise, if any, of the Conversion
      Right;

	 	 	 	 
	 	(e) 	
      no federal or state agency has passed upon, or make any
      finding or determination as to the fairness of this investment, and that
      there have been no federal or state agency recommendations or endorsements
      of the investment made hereunder;

	 	 	 	 
	 	(f) 	
      the Lender acknowledges that:

	 	 	 	 
	 		(i) 	
      there are substantial restrictions on the sale or
      transferability of any Shares acquired upon exercise of the Conversion
      Right and understands that, although the Company is a reporting company,
      the Lender is, upon acquiring the Shares upon exercising the Conversion
      Rights, purchasing unregistered securities;

	 	 	 	 
	 		(ii) 	
      the Lender may not be able to liquidate this investment
      in the event of any financial emergency and will be required to bear the
      economic risk of this investment for a lengthy or even indefinite period
      of time;

	 	 	 	 
	 		(iii) 	
      the Company is not contractually obligated to register
      under the Securities Act any Shares acquired upon an exercise of the
      Conversion Right; and

	 	 	 	 
	 		(iv) 	
      any Shares acquired by the Lender upon exercise of the
      Conversion Right may never be sold or otherwise transferred without
      registration under the Securities Act, unless an exemption from
      registration is available.

	 	 	 	 
	 	(g) 	
      the Lender, alone or with its advisor, has enough
      knowledge and experience in financial and business matters to make it
      capable of evaluating the merits and risks of investing in the
    Company;

	 	 	 	 
	 	(h) 	
      the Lender makes the Loan to the Company and acquires the
      Shares and the Conversion Right as principal for its own account and not
      for the benefit of any other person;

	 	 	 	 
	 	(i) 	
      the Lender understands that any certificates representing
      any Shares acquired by the Lender upon exercise of the Conversion Right
      will have a resale legend on them that will read substantially as
      follows:




  
    
      
        THE SECURITIES COVERED HEREBY HAVE NOT BEEN REGISTERED
          UNDER THE SECURITIES ACT OF 1933, AS AMENDED (“ACT”). THE
          SECURITIES REPRESENTED BY THIS 

      

    

  







  
    
      
        CERTIFICATE HAVE BEEN ACQUIRED FOR INVESTMENT, AND
          NOT WITH A VIEW TO, OR IN CONNECTION WITH, THE SALE OR DISPOSITION THEREOF,
          AND MAY NOT BE OFFERED OR SOLD WITHIN THE UNITED STATES OR TO OR FOR
          THE ACCOUNT OR THE BENEFIT OF U.S. PERSONS (I) AS PART OF THEIR DISTRIBUTION
          AT ANY TIME OR (ii) OTHERWISE UNTIL ONE YEAR AFTER THE LATER OF THE
          COMMENCEMENT OF THE OFFERING OF SUCH SECURITIES OR THE CLOSING DATE
          OF THE SALE AND TRANSFER THEREOF, EXCEPT IN EITHER CASE IN ACCORDANCE
          WITH REGULATION S (OR RULE 144A, IF AVAILABLE) UNDER THE ACT. TERMS
          USED ABOVE HAVE THE MEANING GIVEN TO THEM BY REGULATION S. 

      

    

  



	 	(j) 	
      the Lender has good and sufficient right and authority to
      enter into this Agreement and to carry out the transactions contemplated
      by this Agreement on the terms and conditions contained
  herein.




	1.2 	
      The representations, warranties, covenants and agreements
      of and by the Lender contained in, or delivered pursuant to, this
      Agreement shall be true at and as of the Effective Date and shall remain
      in full force and effect throughout the term of this Agreement.

	 	 	 
	2. 	
      The Loan

	 	 	 
	2.1 	
      Subject to the terms of this Agreement, the Lender hereby
      agrees to loan to the Company, and the Company hereby agrees to borrow
      from the Lender, the sum of US$50,000.

	 	 	 
	2.2 	
      Immediately following the execution of this Agreement,
      the Lender shall deliver to the Company the Loan amount by certified
      cheque or money order made payable to the Company, or by wire transfer to
      the Company’s bank account or to the Company’s solicitors (the
      “Advancement Date”).

	 	 	 
	2.3 	
      Unless repaid earlier, the Loan shall be payable in full
      by 5:00 p.m. local time in Medellin, Columbia, five years from the
      Advancement Date (the “Due Date”). If such day falls on a Sunday or
      statutory holiday, then by 5:00 p.m. local time in Medellin, Columbia, on
      the first business day after the Due Date.

	 	 	 
	2.4 	
      The Company shall be entitled to prepay any sum up to the
      full amount of the Loan then outstanding at any time without penalty or
      bonus.

	 	 	 
	2.5 	
      At any time upon the Company having adequate authorized
      share capital to effect conversions after the Advancement Date, if the
      Company has not paid the Loan in full, the Lender may by providing written
      notice (the “Notice”) and the Declaration attached hereto as
      Schedule A to the Company, exercise its rights of Conversion in respect of
      either a portion of or the total outstanding amount of the Loan as of that
      date into Shares of the Company (the “Conversion Right”), on the
      following terms:

	 	 	 
		(a) 	
      The number of Shares issuable under the Conversion Right
      (the "Conversion Rate") shall be determined by dividing (x) that
      portion of the outstanding principal balance under the Loan on such date
      that the Lender elects to convert by (y) the Conversion Price (as defined
      below) then in effect on the date on which the Lender faxes the Notice of
      conversion, duly executed, to the Company (the “Conversion Date”).
      With respect to








	 		
      partial conversions of this Loan, the Company shall keep
      written records of the amount of this Loan converted as of each Conversion
      Date.

	 	 	 
	 	(b) 	
      The term "Conversion Price" shall mean the lesser
      of $0.06 or 60% of the average Closing Bid Prices for the ten trading days
      immediately preceding the Conversion Date, but in no event shall the
      Conversion Price be less than $0.01.

	 	 	 
	 	(c) 	
      The term "Closing Bid Price" shall mean, on any
      particular date (i) the closing bid price per share of the Common Stock on
      such date on the OTC Bulletin Board or another registered national stock
      exchange on which the Common Stock is then listed, or if there is no such
      price on such date, then the closing bid price on such exchange or
      quotation system on the date nearest preceding such date, or (ii) if the
      Common Stock is not listed then on the OTC Bulletin Board or any
      registered national stock exchange, the closing bid price for a share of
      Common Stock in the over-the-counter market, as reported by the OTC
      Bulletin Board or in the National Quotation Bureau Incorporated or similar
      organization or agency succeeding to its functions of reporting prices) at
      the close of business on such date, or (iii) if the Common Stock is not
      then reported by the OTC Bulletin Board or the National Quotation Bureau
      Incorporated (or similar organization or agency succeeding to its
      functions of reporting prices), then the average of the "Pink Sheet"
      quotes for the relevant conversion period, as determined in good faith by
      the Lender, or (iv) if the Common Stock is not then publicly traded the
      fair market value of a share of Common Stock as determined by the Lender
      and reasonably acceptable to the Company.




	2.6 	
      Within seven (7) days of Notice by the Lender exercising
      its Conversion Rights hereunder, the Company shall deliver a Share
      Certificate to the Lender representing the number of Shares acquired by
      the Lender pursuant to the Conversion Rate set out in subparagraph 2.7 of
      this Agreement.

	 	 	 
	3. 	
      Covenants and Agreements of the
    Lender

	 	 	 
	3.1 	
      The Lender covenants and agrees with the Company that the
      Lender shall not make demand for payment of the Loan prior to the Due
      Date, except as otherwise required herein, unless the Loan has become due
      and payable in accordance with the provisions of this Agreement.

	 	 	 
	4. 	
      Default

	 	 	 
	4.1 	
      If one or more of the following events shall occur,
      namely:

	 	 	 
		(a) 	
      the Company fails to pay any Principal amounts when due
      and fails to repay the Loan on the Due Date;

	 	 	 
		(b) 	
      the Company makes an assignment for the benefit of its
      creditors or files a petition in bankruptcy or is adjudicated insolvent or
      bankrupt or petitions or applies to any tribunal for any receiver,
      receiver manager, trustee, liquidator or sequestrator of or for the
      Company or any of the Company’s assets or undertaking, or the Company
      makes a proposal or compromise with its creditors or if an application or
      a petition similar to any of the foregoing is made by a third party
      creditor and such application or petition remains unstayed or undismissed
      for a period of thirty (30) days;








	 	(c) 	
      an order of execution against any of the Company’s assets
      remains unsatisfied for a period of ten (10) days;

	 	 	 
	 	(d) 	
      the Company fails to observe and comply with any material
      term, condition or provision of this Agreement or any other agreement or
      document delivered hereunder, and such failure continues unremedied for a
      period of thirty (30) days;

	 	 	 
	 	(e) 	
      any representations, warranties, covenants or agreements
      contained in this Agreement or any document delivered to the Lender
      hereunder are found to be untrue or incorrect as at the date thereof;
      or

	 	 	 
	 	(f) 	
      any lender (including the Lender) of any mortgage, charge
      or encumbrance on any of the Company’s assets and undertaking does
      anything to enforce or realize on such mortgage, charge or
    encumbrance;




		
      then the Loan to the date of such default shall, at the
      option of the Lender, immediately become due and payable without
      presentment, protest or notice of any kind, all of which are waived by the
      Company.

	 	 	 
	5. 	
      Independent Legal Advice

	 	 	 
	5.1 	
      The Lender acknowledges that:

	 	 	 
		(a) 	
      Macdonald Tuskey, Corporate and Securities Lawyers
      received instructions from the Company and does not represent the
      Lender;

	 	 	 
		(b) 	
      the Lender has been requested to obtain its own
      independent legal advice on this Agreement prior to signing this
      Agreement;

	 	 	 
		(c) 	
      the Lender has been given adequate time to obtain
      independent legal advice;

	 	 	 
		(d) 	
      by signing this Agreement, the Lender confirms that it
      fully understands this Agreement; and

	 	 	 
		(e) 	
      by signing this Agreement without first obtaining
      independent legal advice, the Lender waives its right to obtain
      independent legal advice.

	 	 	 
	6. 	
      General

	 	 	 
	6.1 	
      For the purposes of this Agreement, time is of the
      essence.

	 	 	 
	6.2 	
      The parties hereto shall execute and deliver all such
      further documents and instruments and do all such acts and things as may
      either before or after the execution of this Agreement be reasonably
      required to carry out the full intent and meaning of this
  Agreement.

	 	 	 
	6.3 	
      This Agreement shall be construed in accordance with the
      laws of the State of Nevada.

	 	 	 
	6.4 	
      This Agreement may be assigned by the Lender subject to
      any assignee making requisite representations to meet applicable
      securities law exemptions; this Agreement may not be assigned by the
      Company.








	6.5 	
      This Agreement may be signed by the parties in as many
      counterparts as may be deemed necessary, each of which so signed shall be
      deemed to be an original, and all such counterparts together shall
      constitute one and the same instrument.

	 	 
	6.6 	
      All notices, requests, demands or other communications
      hereunder shall be in writing and shall be “deemed delivered” to a party
      on the date it is hand delivered to such party’s address first above
      written, or to such other address as may be given in writing by the
      parties hereto.



IN WITNESS WHEREOF the parties have hereunto set their
hands effective as of the date first above written. 

TAO MINERALS LTD. 

 

Per:      /s/ James
Sikora                                             
           
Authorized Signatory 

JOHN C. LAMA 

/s/ John C.
Lama                                                     
 




SCHEDULE A 

DECLARATION OF REGULATION S ELIGIBILITY 

Regulation S of the Securities Act is available for the use of
non-U.S. Persons only. This Declaration must be answered fully and returned to
Tao Minerals Ltd. to ensure the Company is in compliance with the
Securities Act. All information will be held in the strictest confidence and
used only to determine investor status. No information will be disclosed other
than as required by law or regulation, other demand by proper legal process or
in litigation involving the company or its affiliates, controlling persons,
officers, directors, partners, employees, attorneys or agents. 

I, JOHN C. LAMA, HEREBY AFFIRM AND DECLARE THAT: 

	1. 	
      I am not a resident of the United States of
    America.

	 	 
	2. 	
      I am not purchasing securities for the benefit of a
      resident of the United States of America.

	 	 
	3. 	
      I am not purchasing securities in the name of a company
      incorporated in the United States of America or for the benefit of a
      company incorporated in the United States of America.

	 	 
	4. 	
      I am not purchasing securities in my capacity as Trustee
      for a U.S.-based Trust.

	 	 
	5. 	
      I am not purchasing securities in my capacity as the
      Executor or Administrator of the Estate of a U.S. resident.

	 	 
	6. 	
      I am not a U.S. resident purchasing securities through a
      brokerage account located outside of the United States of America, nor am
      I using a non-U.S. brokerage account to purchase securities for the
      benefit of individuals or corporate entities resident within the United
      States of America.

	 	 
	7. 	
      I am not purchasing the securities in an attempt to
      create or manipulate a U.S. market.

	 	 
	8. 	
      I am purchasing the securities as an investment and not
      with a view towards resale.

	 	 
	9. 	
      I will only resell the securities to other non-U.S.
      residents in accordance with Rule 905 of Regulation S, or to U.S.
      residents in accordance with the provisions of Rule 144 following the
      expiration of six months from the Advancement Date, as defined in the
      Convertible Loan Agreement dated concurrently herewith.

	 	 
	10. 	
      I am permitted to purchase the securities under the laws
      of my home jurisdiction.

	 	 
	11. 	
      I understand that if I knowingly and willingly make false
      statements as to my eligibility to purchase or resell securities under
      Regulation S, I may become subject to civil and criminal proceedings being
      taken against me by the United States Securities and Exchange
      Commission.




	DATED: December 1, 2009 	“John Lama 
	  	Signature 
	  	  
	  	John
      Lama 
	  	Print Name